Curt Strand: Insights from the Hospitality Industry’s Genteel Pioneer

Curt Strand has observed the emergence and impact of the global hospitality and travel industries from a vantage point few people have experienced. One of the first employees of Hilton International Hotels, Strand was with the company from the late 1940s until his retirement as chairman and CEO in 1987. It was a period of tremendous growth for the company against a backdrop of a fundamental global reordering following the end of World War II.

Strand also served as a director and vice president of the now-defunct TWA, and has been a consultant for American Express, SAS Hotels, and Tishman Speyer as part of a career in travel that has spanned more than six decades. A small portion of his rich story is below, as told to Travel Weekly PLUS editor in chief Diane Merlino.

“I was one of the first two-and-a-half employees of Hilton International. When we started out in 1949 or so we had a part-time secretary, my boss, and myself. And when I retired [as chairman and CEO in 1987] we had 100 hotels in about 60 different countries, and we were employing 35,000 people.

What I enjoyed most about that experience was the pioneering aspects of it. Anybody can build a hotel in Paris. We did — when there hadn't been a hotel built in Paris in 40 years because the Depression in the '30s had turned off the money. But that was not as satisfying an experience as to do the same thing in, let's say, Addis Ababa, where not a single retail shop existed and you had to try to create something so people would have an experience similar to what they might have in Paris.

That was much more of a challenge, and I enjoyed that particularly — the pioneering aspect, to be able to do something in a place where nobody had done it yet.

We went into a lot of places that had never had any hotel at all, let alone a five-star or four-star hotel. It's a more thrilling experience than doing it in well-established capitals like London or Paris, or even in Berlin.

We built a hotel in Berlin when Berlin was still practically destroyed after the war. There was only one hotel there, in West Berlin, with 100 rooms. And we opened our hotel the same day (former Soviet Union Premier Nikita) Khrushchev gave West Berlin the ultimatum to give up as a separate political unit and join East Germany. That was kind of fun.

Perfect Timing, and MoreAs often happens in life, it’s a question of being in the right place at the right time. We started [Hilton International] when the door was wide open. The war had ended just a few years before, and nobody could afford to travel except Americans. So we built our first hotels where Americans wanted to go, in Madrid, or in Istanbul.

We were there at the right time. We started our company at a time when our founder, Conrad Hilton — who was really not a hotel man; he was really a banker — had an intuition that we needed to expand abroad now that the war was over. Let me tell you a little story about him, because it was basic to what we finally did.

In 1946 or '47 he got a letter from the Puerto Rican tourism development agency and it said, ‘Would you people like to do a hotel here? We would build it, and you would lease it.’ And he answered these people in Spanish. Now, take yourself back to 1946 or '47. At the time Puerto Rico was a colony; it wasn’t called a colony, but it was a colony. To have the intuition to answer a letter from a government authority from a colony, a letter that was written in English, to flatter them and answer it in Spanish took a lot of intuition, which taught me a lot of lessons.

And that’s how we started. We started with nothing. The board gave us $300,000 to be able to have a couple of people on the payroll. And that's all we had, and we grew it, and I enjoyed the exercise of growing it.

When we started there was no such thing as a management agreement. There was no such thing as a franchise. If you had to build a hotel, you either built it yourself or you had a developer build it and you leased it. You paid a fixed rent. After a few years we came to the conclusion that we couldn't take on that much financial responsibility, so we came up with the concept of a management agreement. That’s all over the world today, but it didn't exist when we started — where somebody else builds the hotel and you get paid for managing it.

View from the TopWhen I started in the hotel business I started on the bottom. When I started in the airline business I started at the top. That came about because a major airline acquired Hilton International and made me a director and vice president of the airline. The airline doesn't exist anymore; it was TWA. It’s interesting when you think about it. Pan Am, another airline that doesn’t exist anymore, owned InterContinental, initially our main competitor.

My problem with the airlines today is simply that people have a negative impression of what they're getting when they fly. There are many reasons for this negative perception, but it is not something that was intended. It was not created by the airlines. It is a product of the economics of the business.

But, the airlines absolutely have to find a way to counteract that impression. You always hear, ‘I used to love to fly, and now it's a chore, and it's miserable. I will only fly if I have to.’ You can't go to a cocktail party without somebody telling you their horror stories. The airlines have to find a way to change that, and to overcome the negative feelings of their customers.

My policy of hiring people was, don't worry so much about their experience; you can train them to do the work. Hire people who are naturally friendly, smiling people, because you cannot train people to smile. This goes for all customer-related jobs. Whether it's an airline or a hotel or some other part of the travel industry, hiring people in customer-related personal services based on their work experience is fine, but it won’t determine how great an experience the customer is going to have with these people.

What every passenger is looking for is what John Gerzema in your material [The Post Recession Customer: It’s All About Trust] calls ‘kindness and empathy.’ That is something the airlines are going to have to do if they want to bring their customers back, grow their business, and have people fly not only when they must. That’s what I'm looking for. It has to become a priority again.

These are intelligent people. They can get their heads together and say, ‘Okay, today we're not talking about schedules. We're not talking about new equipment. We're going to talk about kindness and empathy in our business. The pilots don't have to listen, but the people who meet the customers have to listen.’ That’s how flying can become a positive experience again.

NEXT ISSUE: Curt Strand talks about the three major challenges facing the hospitality industry today in the context of his many decades of experience as a pioneer in the field.